RECAP & STOCKS TO WATCH FOR TUESDAY, 2-27-01
Continued expectations of another inter-meeting rate cut by the Fed fueled a broad-based advance by the major indexes, with the Nasdaq putting in a 2nd straight day of gains, and the Dow surging 200 points. Internet and software shares paced the move in the tech arena, with the chip stocks showing weakness on the heels of another warning by Texas Instruments (TXN).
The Nasdaq Composite added 45 points to close at 2,308. Volume was 1.8 billion shares, with advancers outpacing decliners by 24 to 13. Blue chips were impressive as the Dow rallied 200 points to finish at 10,642. Volume on the Big Board was 1.11 billion shares with advancers beating decliners by 22 to 19.
Speculation abounds that the Fed will cut rates again before their next meeting, especially after Bear Stearns economist Wayne Angell announced an 80% probability of a cut, and reports that Fed Chief Greenspan, who will speaking twice this week to address fiscal and monetary issues, will be updating his testimony before the House Financial Services Committee on Wednesday.
From a technical standpoint, the Nasdaq Composite has reversed off that hammer pattern that it formed on Friday, and closed above strong resistance at 2,300 (see chart). The index is showing some room to the upside in the 2,500 area. The Dow also reversed off a hammer and looks ready to test resistance at 10,700. Support on the Semiconductor Index (SOX) stands at 600 and 550, with resistance at 650.
The Nasdaq Composite on a daily basis: tradewindsonline.net
Niku Corp (NIKU): Reported Q4 loss of $0.23 a share, $0.01 better than the First Call consensus of ($0.24). Revenues rose 416.9% to $26.78 mln from a year-ago of $5.18 mln. Company sees Q1 revs of $29.5-31.5 mln and loss of $0.17 to $0.19 per share, narrower than the First Call mean of -$0.20 per share
Sawtek (SAWS): Company warned for Q2, seeing EPS of $0.22-0.24 vs current estimate of $0.29. Revenues for Q2 will be between $29 and $31 mln. Cites slow down in the wireless communication sector continues and order flow and backlog lower than originally projected;
SURPRISE STORY OF THE DAY (NOT): eToys (ETYS): Company announced that it plans to file for protection under federal bankruptcy law within approximately the next five to 10 days. The company also said that its outstanding equity securities, including both its common stock and its Series D preferred stock, have no value.
Emmis Comms (EMMS): Company warned for Q4, seeing same-station domestic radio net revenue down 6-8%, with domestic radio broadcast cash flow down 3-5%. Q4 radio net revenue will be down 5-7%, while radio broadcast cash flow will be down 21-24% due to significant investment spending in new radio properties.
QUALCOMM (QCOM): Company announced that it has settled class action law suit filed by two former employees for $11 mln. The lawsuit stems from the sale of assets associated with QUALCOMM's infrastructure division to Ericsson (ERICY). |
